April 4, 1944
 
MEMORANDUM ON CURRENT NEWS IN CHINA
 
              1. The Generalissimo is apparently still out of town - the reason for the long delay in the
release of the Chinese statement regarding Sinkiang was it had to be telegraphed to the
Generalissimo for approval. The common rumor is that he is in Sian, although some say Lanchow.
 
              2. From many sources come reports that the Generalissimo has been under great strain
during the past few weeks, some even saying that he has been "half crazy" There is
general agreement that the problems worrying the Generalissimo are; increasing foreign criticism
(Chinese are desperately curious to learn the contents of recent articles in the foreign
press which are known to have been published but which are not released in China); relations with
the American Army, including Army expenditures, negotiations over exchange rate, and problems
brought up by General Stilwell (the story is around that the Generalissimo hit the roof after his
talk with the General); and the Sinking situation (the Generalissimo is credited with daily tantrums
at the slow progress of the Central Government military reinforcernents moving  toward Sin-
kiang by truck and the jittery attitude of Chinese officials regarding publicity is explained by the
Generalissimo's order that nothing is to be released except after his approval).
 
            3. The Chinese statement regarding, the Sinking bombing incident (which appeared this
morning) is an extremely weak reply to the TASS story. It now appears, despite early
Chinese denials, that the border between Sinkiang and Outer Mongolia is in dispute, and that the
original bombing occurred very close to the line claimed by Outer Mongolia. Official
Chinese circles are very jittery. After first trying to play the incident up, they are now trying to
tone it Censors prevented publication of the TASS story. Rumors persist that Ma Chung-yin is
loose somewhere in Sinkiang. If this is true, it may mean trouble. The Central
Government is rushing the 42nd Army to the province.
 
            4. The prospect, for settlement of Kuomintang Communist probems seems to be getting
worse. Lin   Pai-hsu,